Moody’s shifts DBSA, IDC views to negative

Moody’s Investors Service said it revised the outlooks for the Development Bank of Southern Africa and the Industrial Development Corp. of South Africa to negative from stable.

This revision follows the change in the outlook for South Africa’s government to negative from stable.

“The negative outlooks on both issuers reflect the increasing risk of a weakening capacity of the South African government to support DBSA and IDC in case of need, as captured by the negative outlook assigned to the sovereign rating. The latter reflects the material risk that the government will not succeed in arresting the deterioration of its finances through a revival in economic growth and fiscal consolidation measures,” said Moody’s in a press release.

Moody’s affirmed the Baa3 ratings on both entities.

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